Comment by throwaway3999 | Hacker News Reader

Comment by throwaway3999 | Hacker News Reader

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There's a common theme on HN that it's all the fault of consumers for wanting free stuff. The truth is, budgets are limited, and if you start charging for stuff you will soon find out how much consumers actually value it - with respect with other stuff they can buy. I'm not talking about the average HN user making six figures in a cushy software job - of course you'd pay for a product like Gmail. But think about most people who don't care that much about technology, to whom it's just a tool and not an art, a craft or a hobby. Do you really think your product is that valuable? Do you really think people are willing to buy your content - enough that you can stay afloat?

It's not that consumers want free stuff, it's just that most people do not have extra money laying around.

I'll also add that "charging a fair price" has never deterred companies from engaging in unethical and privacy-violating practices in addition to taking your money. See: Microsoft, Amazon, etc.

I'm not faulting consumers for wanting free stuff. If anything, it's a symptom of companies (and investors) putting too much value in vanity metrics and expecting that it will be easy to transition to revenue.

I've seen it first-hand: startups intentionally forgoing revenue so they can be measured by the stick of imaginary future profits correlated with their free product's success. Then when investors finally do start asking to see real returns, it's a scramble to find something that doesn't involve charging their current user base (because of course no one wants to pay for something that has been free previously). That's when the "creative" money-making ideas start getting real consideration.

In effect, those actions end up communicating to the public that software is free when it really isn't. It gives the impression that there isn't a cost associated with developing and maintaining software, when really it might just be funded temporarily by investors with deep pockets and high expectations, or supported by other revenue sources that the end user would not agree to in full transparency.

My understanding is that VCs actively encourage the behavior of “grow then figure out the business model.” Of course, if you are a free product at scale, the most simple solution is to start selling data, since it avoids the challenge of trying to get consumers to pay for something they “believe” is free. This obviously leads to free products that are less and less in the interest of the user, but it’s very very difficult to convince someone who got a thing for free that it can’t continue forever that way, even if there are obvious costs that must be converted to supply the free good. This is especially true if the competitors are offering free based on selling data. There’s definitely an interesting and challenging future in finding ways to scale in spaces that are currently dominated by “free” in exchange for data and privacy.

I imagine people probably would pay for gmail if they didn't get a free account through their ISP. it wasn't too long ago that email was either a paid service or bundled with an internet connection.

I don't get the vibe that HN thinks the current state of affairs is completely the fault of the customers. it's a two way street. companies offer free services either at a loss or supported by ads or data mining. once people have a free option, it takes a lot of value add to get them to actually pay for a competing solution.

I'm sure that's much of it. But some people just really like free stuff. I used to volunteer at a conference series with a $5k price tag. Many of the attendees were wealthy. But when we put out free stuff on the giveaway table, even stuff they could easily buy, a lot of those rich people were very grabby.

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